UAE banking sector sees significant growth in capital and investments

The Central Bank of the UAE (CBUAE) has published new data highlighting significant growth in the banking sector’s capital, reserves, and investments as of June 2024.

By the end of June 2024, banks operating in the UAE reported combined capital and reserves of AED495.2 billion, reflecting a 10.6% increase compared to AED447.8 billion in June 2023. On a monthly basis, this figure rose by 1.5%, with a 1.2% increase during the first half of 2024.

National banks led the sector, holding 86.3% of the total capital and reserves, valued at AED427.5 billion in June, up from AED386.6 billion in June 2023—a 10.6% YoY increase.

Foreign banks held the remaining 13.7%, with their capital and reserves reaching AED67.7 billion, also marking a 10.6% YoY growth from AED61.2 billion.

Investments in the UAE banking sector surged, exceeding AED680 billion by the end of June 2024. This reflects an 18.4% YoY increase from AED574.3 billion in June 2023, a growth of AED105.9 billion in 12 months.

Between May and June 2024, investments increased by 1.07%, while the first half of the year saw a 7.1% rise, adding AED45.1 billion since the end of 2023.

Bonds held to maturity comprised 48.8% of total investments, amounting to AED332.2 billion—a 0.1% monthly rise and a 26.2% YoY increase.

Debt securities accounted for 41.1%, reaching AED279.6 billion, with a 2% monthly and 12.5% YoY increase. Equity investments also significantly increased, reaching AED16.7 billion in June, up 38% YoY and 1.8% monthly. Other investments rose by 2.2% month-on-month and 2.6% year-on-year.

The CBUAE clarified that these investment figures exclude bank deposits with the Central Bank, such as Certificates of Deposit and Monetary Bills.